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Wall St. Breakfast's Pre-Market Snapshot:

U.S. Futures As of 8:52 AM EST

S&P 500: -4.90; 1,456.90
NASDAQ 100: -8.25; 1,830.50
Dow: -41.00; 12,755.00

International Indexes

Asia
NIKKEI 225: -0.14%; 17,913.21 (-25.91)
HANG SENG: +0.41%; 20,651.42 (+83.51)
S&P/ASX 200: -0.63%; 5,951.80 (-37.90)
BSE SENSEX 30: -0.46%; 14,188.49 (-64.89)

Europe
FTSE 100: -0.44%; 6,384.30 (-28.00)
CAC 40: -0.37%; 5,692.21 (-21.24)
XETRA-DAX: -0.32%; 6,960.23 (-22.68)

Commodity Futures (Reuters/Jefferies CRB)

Oil: -0.85%; $58.35 (-$0.50)
Gold: +0.30%; $663.00 (+$2.00)
Natural Gas: -0.28%; $7.56 (-$0.02)
Silver: -0.11%; $13.815 (-$0.015)

U.S. Breaking Newssee today's Wall Street Breakfast for earlier news

U.S. Core CPI Highest Since June; Futures Slide

In another indication the Fed's inflation concerns may not be going away as quickly as investors would like them to, the U.S. Labor Department reported consumer prices rose more than expected in January to a core rate (excluding food and energy) of 0.3% - the highest reading since June 2006. Including energy and food prices, the non-core CPI rate was just 0.2% after gaining 0.4% in December; the core rate was higher by just 0.1% in December. Mesirow Financial Chief Economist Diane Swonk believes that "for all the talk about inflation pressures starting to ease, the Fed still says inflation is the biggest concern, and there's nothing to take them off that stance." MarketWatch median estimates were for a Core-CPI gain of just 0.2%. U.S. futures slipped on the report.
• Sources: Bloomberg, MarketWatch
• Commentary: Getting In Touch With the Real World of InflationU.S Equity Market: Why Now is Not the Ideal Time to Invest
• Stocks and ETFs to watch: S&P 500 Index - "Spiders" (SPY),
Diamonds Trust, Series 1 (DIA), iShares Lehman Aggregate Bond (AGG)

Zale: Earnings Up Slightly, Same Store Sales Seen Slipping in Q3

Zale reports Q2 net income grew less than 1% to $88.1 million, or $1.80/share, on revenue growth of 1% to $1b. Same store sales were positive for the first time in three years, up 1.4%, but guidance for Q3 is below analysts' estimates. Adjusted EPS totaled $1.94, short of the $1.96 last Q2, but ahead of analysts' average estimate of $1.89. Revenue however, came in short of analysts' $1.02b estimate.Zale-ZLC-1yr-chart-02-20-07 Zale said it expects Q3 same store sales to decline 2 to 3% and EPS flat to $0.04/share. Analysts polled by Thomson were expecting $0.25/share. CEO Betsy Burton comments, "In the second half, we will continue maximizing gross profit dollars as well as focus on expense reduction, particularly those investments in payroll and marketing that did not generate sufficient sales gains to justify."
Sources: Press release, BusinessWeek, Forbes-AP
Commentary: Earnings Preview: Zale CorporationZale Blames Poor Q1 Earnings On Derivative Accounting For Precious MetalsZale Corp Earnings Conference Call Transcript (later today)
Stocks/ETFs to watch: Zale Corp (ZLC). Competitors: Tiffany & Co (TIF), Sterling Jewelers -- owned by Signet Group plc (SIG), Helzberg Diamonds -- owned by Berkshire Hathaway (BRK.A)

JetBlue Drops Q1 and 2007 Forecasts Post Ice-storm Crisis

JetBlue Airways revised its Q1 and 2007 forecast this morning due to the severe service disruptions it experienced during and after the Feb. 14 ice storm. The storm cost the company $30 million, stranded more than 130,000 customers, and resulted in the cancelation of 1,100 flights (32% of its schedule). JetBlue now forecasts an operating margin of -2% to -4%, instead of the 2% to 4% it had forecast before the breakdown. Q1 pretax margin will JetBlue Airways 21 02 2007 Chartnow be -8% to -10%, compared with a previous forecast of -2% to -4%. Its full year operating margin forecast was revised down to 8-10% from 10-12%. In a "Customer Bill of Rights" announced yesterday, the company said it will allow customers to leave planes grounded for over five hours. Travelers whose flights have landed but can't dock at a gate will receive vouchers for future travel, the value of which depends on the length of their delay. CEO David Neeleman said yesterday he expects normal operations to resume today. Shares of JBLU were down $0.66 (4.9%) to $12.90 in trading yesterday.
Sources: Press Release, MarketWatch, Bloomberg
Commentary: Post-Snowstorm Trading: Comparing JetBlue and NorthwestCould the JetBlue Fiasco Have Been Avoided?Wall Street Journal (video)
Stocks/ETFs to watch: JetBlue Airways Corp. (JBLU)

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Asian Headlines (via Bloomberg.com)

Asian Stocks Fall, Led by Tokyo Electric on BOJ Rate Increase; Banks Gain Asian stocks fell for a second day. Tokyo Electric Power Co. led Japanese power companies lower on concern their debt costs will increase after the Bank of Japan raised its benchmark interest rate target.

Hindustan Lever to Increase Food Sales to Address Slowing Revenue Growth Hindustan Lever Ltd., India's biggest household products maker, plans to increase food sales by adding products to win new customers and increase profit margins.

Brambles Profit Increases on Pallet Sales; Chief Executive Turner Resigns Brambles Ltd., the world's biggest supplier of pallets used to move and store goods, said first-half profit rose 50 percent as sales advanced at its pallet-hire and document management divisions.

Thailand Holds Talks With Temasek on Buying Back Thaksin-Linked Assets Thailand has held ``unofficial'' talks with Singapore's Temasek Holdings Pte. about buying satellite and mobile phone assets it acquired from investors including the family of deposed Premier Thaksin Shinawatra.

European Headlines (via Bloomberg.com)

European Commodity Stocks Drop; Alliance & Leicester, Nordea Shares Rise European commodity stocks dropped after oil prices slumped in New York and earnings at Anglo American Plc (AAUK) missed analysts' estimates. Benchmarks were little changed in the region.

EU Fines Otis, ThyssenKrupp Record $1.3 Billion for Fixing Elevator Prices European authorities fined United Technologies Corp.'s (UTX) Otis unit, the world's largest elevator maker, and four competitors a record 992.3 million euros ($1.3 billion) for price-fixing.

Apollo Offers to Buy U.K. Real Estate Broker Countrywide for $2 Billion Apollo Management LP, the U.S. buyout firm run by Leon Black, offered about 1 billion pounds ($2 billion) for Countrywide Plc, the second bid in five months for the U.K.'s largest residential real estate broker.

Bank of England Voted 7-2 to Keep Main Interest Rate at a Five-Year High Bank of England rate-setters voted 7-2 to keep the bank rate at a five-year high this month, signaling they may pause before considering a further rate increase.

ABN Amro Is Undervalued, Should Be Broken Up, TCI Hedge Fund Urges Board ABN Amro Holding NV (ABN), the biggest Dutch bank, is ``significantly'' undervalued and should be broken up, according to TCI Fund Management, a U.K. hedge fund that two years ago led the ouster of Deutsche Boerse AG's top executives.

Source: Pre-Market Snapshot: Futures Lower On Core CPI Data